At the beginning of 2013, a time of cuts and adjustments, Model 720 was born: an informative declaration to the Tax Agency of assets abroad having value exceeding €50,000 (chiefly bank accounts, financial investments and real estate). However, it must be noted that in most cases the taxpayer’s personal income tax return would include such information. The penalties for not complying with this obligation could exceed 150% of the tax due.
In 2015, the European Commission stated in a recommendation that Model 720 clearly failed to comply with several community principles and filed an appeal to the Court of Justice of the European Union (CJEU). Sadly, in Spain these matters are left to the EU Court, so the government and the legislator did nothing.
On 27 January 2022 the CJUE pronounced its judgment. The important aspects of the judgment are:
- Those who have never made a Model 720 declaration, but should have, must
file one now because currently no specific sanctioning regime is in force
except the general sanction regime (for failing to submit a tax filing on time).
The general four-year statute of limitations period will now apply.
- Those sanctioned for late filing of a Model 720 declaration will receive a claim requesting the fine to be paid.
- If you challenge the sanction within the four-year period, consider requesting state liability.
Regardless of these points, for the 2021reporting period a supplementary reporting obligation has been added:
crypto assets (a new class of assets) must be included in the Model 720 declaration form, which had to be submitted by 30 March 2022.